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FEATURES/Big Bet | Nov 20, 2012 | 17805 views

How ISRO Can Join Hands with Private Enterprise

With demand for launches doubling, the space agency wants industry to step up. What will it take for the two sides to pull this off?
How ISRO Can Join Hands with Private Enterprise
SKY’S THE LIMIT Isro chairman K Radhakrishnan wants the industry to form a consortium and build a PSLV by 2017

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rocket blasting into space doesn’t make news today, such routine are satellite launches and so mature is technology. But, in May, a rocket launch by Californian company SpaceX made news. In fact, it made history as it became the first commercial vehicle to visit the International Space Station (ISS). The launch also signalled an era of private enterprise entering space—US space agency Nasa’s biggest bet in recent times of entrusting small, private companies with big, public responsibilities.

At Antariksh Bhavan, Indian Space Research Organisation’s (Isro) headquarters in Bangalore, Chairman K Radhakrishnan is shuffling his cards for a somewhat similar bet: Of entrusting Indian companies with the task of building rockets and satellites. Isro has a nearly 30-year-old partnership with the Indian industry. Its enduring tango with 400-odd companies has often been cited as a model for the defence sector to emulate.

But what Radhakrishnan is now proposing is of a much higher order: It requires the industry to put its skin in the game. He wants the industry to form a consortium and build a Polar Satellite Launch Vehicle (PSLV)—Isro’s workhorse with 21 consecutive launches—by 2017.

The project may sound over-ambitious, but, in reality, Isro’s time is running out. The 12th Five-Year Plan has sanctioned at least 58 missions in the next five years, as against 29 in the previous five. This boils down to almost one launch a month. The outlay has also doubled from Rs 20,000 crore to Rs 39,750 crore. As Isro can’t double its internal resources, its flight path terminates at the industry.

Globally, this is how most space agencies have built their programmes as well as their local space industry. The US has a tradition of major firms competing for business, with Nasa acting as a managing and contracting organisation. Russia is also catching on, though they have some competing state-run firms too. China is an enigma for most, but experts believe it is taking the Russia route.

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On its part, Isro has closely worked with the private sector before; nearly 60 percent of its budget goes to the industry. The catch is that it has never delegated a fully functional system, say, an engine, to a company. To expect a functional launch vehicle or a satellite from the industry now, Isro will not only have to change its business and organisational model but even its contractual rulebook. That may turn out to be no less challenging than the deep space exploration it has taken up recently. Radhakrishnan says it is possible within the existing government framework. “Five years is a good period in which we can see a launch coming out of the new arrangement; I see a lot of enthusiasm [in the industry].”

For the industry, the opportunity is unprecedented: Rs 20,000 crore, i.e. nearly half of the Plan outlay in the domestic market, and the chance to enter the global supply chain of a market that is worth $290 billion today.

It was in the mid ’70s that Isro first began to engage with the industry for supplying components. It increased its ambit in the ’80s when its programmes began to mature. In 1983, Hindustan Aeronautical Limited (HAL) signed an MoU with Isro under which the former dedicated a 54-acre facility for building parts of launch vehicles. That was also the time when Godrej & Boyce kicked off its association with Isro by supplying satellite parts. Over time, they started making liquid engines. One of Isro’s oldest partners is Larsen & Toubro which, in the last 35 years, has worked on all versions of launch vehicles.

Today, the industry does nearly 80 percent of the value addition to PSLV. But Isro maintains a tight control on quality and final integration. It supplies everything from design to materials—even the nuts, bolts and washers. If the industry has to step up, Isro will have to let go of many of its intermediary functions. Companies like L&T and HAL say they are prepared to procure materials, which are often subject to international controls.

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Comments (7)
Adithya Raju Apr 3, 2013
why cant we use wireless power transmission and send a Geosynchronous into space. can the technology come in future
Chandan Dec 4, 2012
ISRO needs 100% perfection....down the lane suppliers should be prepared to face unexpected challenges from any directions....most of them comes from technical side...later it is managerial.....finally quality matters for ISRO....all the best
Krishnamurthy Nov 22, 2012
Well-researched and well-written article. ISRO, in the last two years has almost driven in neutral, if not reverse gear. This article is proof that they must get back into top speed, especially in decision making.
Sachi Mohanty Nov 20, 2012
I thought Peter Diamandis said somewhere that there are TOO MANY launch service providers out there and fighting for a too-small pie of launch contracts.

I think launching endless satellites into Low Earth Orbit is a bit of a dead-end business.

Twitter: @sachi_bbsr
Response to Sachi Mohanty:
Sanjay Nov 21, 2012
India is unbeatable on cost, coming in even lower than China. When the dust has cleared, India can still be standing while others will have been forced to bow out of the competition. With the right inputs and strategy, aerospace can become India's new IT growth sector. Besides, the high-end technologies used in the space sector are 110% useful for development as well. Today, we talk about green solar energy, but it was the space sector which originally pioneered the development of solar power systems. A thriving aerospace sector will nurture a whole new generation of engineers capable of innovating solutions for India's numerous development challenges.
Sanjay Nov 20, 2012
India will certainly benefit if space launch operations are spun off to the private sector. Private players will be more agile and competitive in the marketplace, courting more opportunities while refining technologies and systems across a greater number of spaceflights. ISRO can then shift back to the role of doing fundamental research and development, perhaps taking the bolder and more adventurous path of developing and proving newer generations of launch vehicles.
Clearly, the well-worn and well-known routine operations should be left to private partners, who can then focus on streamlining operations while reducing costs. Space is a very strategic high-technology sector, and with the traditional sources of income like Call Centres, BPO and even IT starting to run dry, Indians should waste no time in moving into the higher-margin frontier field of aerospace.
Dr. Rushi Ghadawala, President - Aryavarta Space Organization Nov 20, 2012
This is indeed the great news for private players like us in the space industry. After having partnership with industries outside India, Aryavarta Space Organization (ASO) has come to homeland - India, though it is very young organization, it is contributing at Working Group Committee at UN OOSA during various international conferences has also emphasized the requirement of private - public partnership to open a new gateway
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